Vietnam’s Cosmetic Beauty Market: Business Setup and Legal Perspectives on Imported Products

1. Market Overview and Growth Potential

Vietnam’s beauty and personal care market continues to expand rapidly, with total market value estimated at over USD 2 billion and projected to grow steadily over the next decade. Imported cosmetic products dominate the market, accounting for more than 90% of total consumption, making Vietnam a highly attractive destination for foreign brands.

Key growth drivers include:

• Rising disposable income and a fast-growing middle class

• Increased awareness of skincare, wellness, and personal grooming

• Strong influence from Korean, Japanese, European, and U.S. beauty trends

• Expansion of modern retail and cross-border e-commerce platforms

For foreign investors, Vietnam represents not only a consumer opportunity but also a strategic regional hub—provided the business setup and legal entry process is handled correctly from the outset.

2. Business Setup and Company Registration in Vietnam

Before importing or distributing cosmetic products, foreign companies must complete company registration in Vietnam or appoint a legally recognized local distributor.

Common business setup models include:

• Wholly foreign-owned company (FIE) for full control over import and distribution

• Representative office for market research and brand presence (non-trading)

• Local distributor or agent partnership to reduce initial setup complexity

Company registration typically involves:

• Investment registration certificate (IRC), where applicable

• Enterprise registration certificate (ERC)

• Registered business lines covering cosmetic trading, import, and distribution

• Capital contribution and post-licensing compliance

Choosing the right business structure at the company registration stage is critical, as it directly affects licensing scope, tax obligations, and eligibility to conduct product registration and import activities.

3. Product Registration Requirements for Imported Cosmetics

Product registration is a mandatory legal requirement before any cosmetic product can be imported, marketed, or sold in Vietnam. The process is regulated by the Ministry of Health and aligned with ASEAN Cosmetic Directive standards.

Key requirements include:

• Cosmetic product notification dossier submission

• Certificate of Free Sale (CFS) or equivalent from the country of origin

• Ingredient lists and safety assessments

• Compliance with prohibited and restricted substance regulations

Only entities legally registered in Vietnam—either the foreign-invested company or an authorized local importer—are permitted to conduct cosmetic product registration.

Failure to complete proper product registration can result in customs clearance delays, product seizures, administrative fines, and reputational risk.

4. Labeling, Customs, and Import Compliance

After successful product registration, imported cosmetics must comply with:

• Vietnamese labeling requirements, including product name, usage instructions, warnings, importer details, and batch/expiry information

• Customs declaration and HS code classification

• Payment of import duties and 10% VAT, unless preferential tariff treatment applies under free trade agreements

Non-compliance at customs can significantly disrupt supply chains and increase operational costs, especially for brands entering Vietnam for the first time.

5. Compliance Risks and Operational Challenges

Despite strong market potential, foreign cosmetic brands face several risks:

• Regulatory complexity: Frequent updates to health, labeling, and import regulations

• Counterfeit and gray-market products, particularly on e-commerce platforms

• Trademark and IP risks if brand protection is not registered early

A compliant business setup, combined with early trademark registration and structured distribution agreements, is essential to mitigating these risks.

6. Strategic Considerations for Market Entry

To succeed in Vietnam’s cosmetic beauty market, foreign investors should:

• Align business setup and company registration with long-term expansion plans

• Ensure product registration timelines are built into go-to-market strategies

• Engage experienced local advisors to manage licensing, customs, and post-setup compliance

• Combine offline retail presence with compliant e-commerce distribution

Proper planning at the business setup stage reduces regulatory friction and accelerates time to market.

Conclusion

Vietnam’s cosmetic beauty market offers strong growth potential for imported products, supported by consumer demand and a preference for international brands. However, sustainable success depends on more than market demand alone.

Foreign companies must approach Vietnam with a clear understanding of company registration, product registration, and business setup requirements, supported by a robust compliance framework. By addressing legal obligations early and strategically, investors can confidently enter the market, protect their brand, and achieve long-term growth in one of Southeast Asia’s most promising beauty markets.